3 ways ETFs are dangerous

Exchange Traded Funds can be a low-cost, tax-efficient vehicle for investing in stocks. But they are not always the best option. Here are a few situations where buyers should beware.

Quincy Krosby, market strategist at Prudential Financial, said this market has rewarded investors who bought the dips over the past five years.

“August tends to be a weak month for stocks because of seasonality. Most people around the world are on holiday, which means lower volumes. In absence of economic and corporate news, geopolitical headlines will be driving the markets,” Krosby said.

In today’s sole economic news, the U.S. trade deficit shrank in June, largely because imports of petroleum fell to the lowest level since late 2010. Reaction to stronger-than-expected economic data over the past few weeks had been generally negative, as investors worry that accelerating growth may force the Federal Reserve to start raising rates sooner than currently anticipated.

Groupon, Time Warner, Sprint on the move

Meanwhile, Time Warner Inc.
TWX, -0.45%
shares sank 13% after 21st Century Fox Inc.
FOX, +1.39%
said late Tuesday that it was withdrawing its proposal to buy the company. 21st Century Fox shares rose 2.3%.

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